City of Vancouver applauds new Airbnb tax in Quebec

The City of Vancouver likes what they see in Quebec when it comes to taxing short-term vacation rentals like AirBnB.

“It very much aligns with what we were proposing,” said Kaye Krishna, General manager of Development, Buildings, and Licensing for the City of Vancouver.

This week, Airbnb and the Government of Quebec announced the first-ever tax remittance agreement in Canada.

This agreement allows Airbnb to collect and pay the tax on lodging on behalf of the hosts on its home-sharing platform. Beginning on October 1, 2017, Airbnb will automatically collect and remit the 3.5% tax on lodging on bookings made in any of Quebec’s 22 tourist regions.

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In Vancouver, a report outlining the framework for a similar strategy is coming to council on October 4, and states anyone who wants to rent out their principal homes – whether they own or rent – for less than 30 days must follow a set of guidelines to do so.

Krishna told Daily Hive that from a municipal point of view, “we don’t govern a lot of the tax policies and that really is federal and provincial. So it’s incumbent on the provinces across the country to have these kinds of conversations.”

She thinks a policy such as the one in Quebec is great on two levels.

For starters, she said, “it helps to bring emerging Internet economies into the norm of how other businesses function.”

Bringing them into the fold like this “starts to normalize them in a way that I think is quite positive and creates equity among different types of businesses and players who are doing similar businesses and functions. I think that’s great.”

Secondly, it’s great because historically, “city and provincial governments have had a difficult time negotiating with some of the emerging economies – whether it’s things like rideshare or short term rentals, ” Krishna explained.

“So any advances in those conversations and any collaboration and cooperation between these internet businesses… I think is positive to see.”

When it comes to where Vancouver and the province are at in the conversation around the subject, Krishna said the city has had “informal” conversations with staff at a provincial level, but haven’t formally discussed anything yet.

It’s important to note, she added, that Airbnb is “one of many online platforms” and each company has its own terms in how they are willing to cooperate and how they’re willing to negotiate with the government.

In the interim, Krishna noted, the city would try and propose a sort of “transaction fee” that would help “to offload the cost of running the program and setting up the program” with things like business licensing and enforcement.

The city’s original proposal was put forward “when the provincial government was still sort of in a flux and was just string to settle,” she explained. “We’ve sought to have a public forum this fall and I think once we go through the public hearing ad confirm what our approach will be is when we’ll really want to sit down with the province and make theses suggestions.”